RTA: 45G tax credit raises 2013 tie forecast

The 45G infrastructure tax credit for shortline railroads has been authorized retroactively for 2012 and extended for 2013. The Railway Tie Association (RTA) responded to this news, saying that for RTA members, this is a game changing piece of legislation for hardwood and softwood tie demand for 2013.

The RTA says that econometric tie demand forecasting model now suggests that at least 500,000 ties to as many as 1.2 million ties will be added to the market demand for 2013. This raises the total 2013 forecast for new wood tie demand to 23.3 million, on the low-end, to an upper-end of 24.0 million.

"With the 2012 election comes a new Congress with significant new challenges," said RTA Executive Director Jim Gauntt. "There are 81 new members of Congress, very few of which will have any knowledge of or experience with the railroad industry. Likewise of the 255 co-sponsors of the just passed 45G legislation, 47 are now gone and will have to be replaced with new co-sponsors.

"As we have done in the past, we need to do our part by bringing the message to the Congressmen who represent us and understand the importance of our facilities," said Gauntt.

In that regard, Gauntt urges all RTA members to send at least one or two representatives to the March 14 Railroad Day on the Hill event.

"This is the most important lobbying day of the year for the railroad industry and I cannot think of a better way in which RTA members can positively impact the demand for ties than by showing up in force to tell the 45G story", said Gauntt. "It is a story about jobs, economic development and preserving rail service in rural and small town America and it is best told by the entrepreneurs, such as those RTA represents."